Chapter 3 definitions Flashcards
What is actual costing system?
a csot accounting system in which costs are assigned to a cost object by using data on actual costs incurred during the accounting period
What is cost accounting
An area of accounting that involves measuring, recording and reporting product costs
what is a cost accounting system?
manufacturing cost accounts that are fully integrated into the general ledger of a company
What are job cost sheets
a form used to record the costs that are chargeable to a job and to determine the total and unit costs of the completed job
What is a job order cost system
a cost accounting system in which costs are assigned to each job or batch
What is a materials requisition slip
a document authorizing the issue of raw materials from the storeroom to production
Normal Costing system
a cost accounting system that traces direct costs to a cost object by using the actual cost data incurred during the accounting period and that allocates indirect costs based on the predetermined rate(s) times the actual quantity of the cost-allocation base(s)
predetermined overhead rate
a rate based on the relationship between the estimated annual overhead costs and the expected annual operating activity, expressed in terms of a common activity base
Process Cost system
a system of accounting that is used when a large volume of similar products are manufactured
Proration
the process of assigning under and over applied overhead costs to the inventory accounts WIP and FG and GOGS
Summary entry
a journal entry that summarizes the totals from multiple transactions
Time Ticket
a document that indicates the employee, the hours worked, the account, the job to be charged and the total labour cost
Under applied over applied overhead
a situation in which the overhead assigned to WIP is less than or more than the overhead incurred
